Home
LoginReal account
Ready to trade?
Register now

Engulfing Candlestick Strategy

This pattern indicates a reversal in price movement. We see this signal after a candlestick has appeared and its body is bigger than the previous reversal candlestick, known as an engulfing candlestick. Once this signal appears, it's important to be alert and observe the direction of the subsequent candlestick. If the following candlestick moves in the same direction as the engulfing pattern, consider opening a deal after its closure.

What to do when this signal appears:

1) See a bigger candlestick in the opposite direction to a previous candlestick.

2) Wait for a new candlestick confirming a direction.

3) Open a deal in the engulfing direction after closing a new candlestick.

Buying a put after a bearish engulfing pattern

The strength of the price movement after a reversal is directly proportional to the size of the engulfing candlestick. When dealing with a substantial engulfing candlestick, especially if you've gained some profit, there's potential for online trading after its closure. However, it's crucial to be patient and wait for confirmation of candlestick signals before making any moves.

Ready to trade?
Register now
ExpertOption

The Company does not provide services to citizens and/or residents of Australia, Austria, Belarus, Belgium, Bulgaria, Canada, Croatia, Republic of Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Iceland, Iran, Ireland, Israel, Italy, Latvia, Liechtenstein, Lithuania, Luxembourg, Malta, Myanmar, Netherlands, New Zealand, North Korea, Norway, Poland, Portugal, Puerto Rico, Romania, Russia, Singapore, Slovakia, Slovenia, South Sudan, Spain, Sudan, Sweden, Switzerland, UK, Ukraine, the USA, Yemen.

Partners
Affiliate program
Partners

Payment methods

Payment and Withdrawal methods
Trading and investing involves significant level of risk and is not suitable and/or appropriate for all clients. Please make sure you carefully consider your investment objectives, level of experience and risk appetite before buying or selling. Buying or selling entails financial risks and could result in a partial or complete loss of your funds, therefore, you should not invest funds you cannot afford to lose. You should be aware of and fully understand all the risks associated with trading and investing, and seek advice from an independent financial advisor if you have any doubts. You are granted limited non-exclusive rights to use the IP contained in this site for personal, non-commercial, non-transferable use only in relation to the services offered on the site.
Since EOLabs LLC is not under the supervision of the JFSA, it is not involved with any acts considered to be offering financial products and solicitation for financial services to Japan and this website is not aimed at residents in Japan.
© 2014–2024 ExpertOption
ExpertOption. All rights reserved.